A child actress and model, she was a repertory cast member of CBS Radio's The March of Time, and appeared in several films in the late 1920s.

She became a leading lady upon returning to the screen in the late 1930s, while still in her teens, and made two dozen movies between 1938 and 1946, including portraying Tyrone Power's love interest in the classic Jesse James (1939), which also featured Henry Fonda, and playing opposite Spencer Tracy in Stanley and Livingstone, later that same year.

After turning to the stage in the late 1940s, she had her greatest success in a character role, the distraught mother in The Bad Seed, receiving a Tony Award for Best Actress in a Play for the 1955 stage production and an Academy Award nomination as Best Actress for the 1956 film adaptation, her last film role.

Kelly then worked regularly in television until 1963, then took over the role of Martha in the original Broadway production of Who's Afraid of Virginia Woolf?

[6][7] Kelly was the first ingenue on CBS Radio's The March of Time series, with a vocal versatility that made it possible for her to portray male parts as well as female.

[8]: 434 As an adult, Nancy Kelly was a leading lady in 27 movies in the 1930s and '40s, including director John Ford's Submarine Patrol (1938) with Preston Foster, Frontier Marshal (1939) with Randolph Scott as Wyatt Earp, Jesse James (1939) with Tyrone Power and Henry Fonda, Stanley and Livingstone (1939) with Spencer Tracy, the comedy He Married His Wife (1940) with Joel McCrea, Parachute Battalion (1941) with Robert Preston, Edmond O'Brien, Harry Carey, and Buddy Ebsen, and Tarzan's Desert Mystery (1943) with Johnny Weissmuller.